The central Bangladesh Bank (BB) has introduced a new rule to bring transparency in online purchase of tickets, lottery and prevent online gambling as well as purchasing of cryptocurrency through misuse of dual currency or international credit cards.
A customer has to fill up a transaction form and submit this either through a mobile app, which has not been developed yet, or as a hard copy prior to purchasing goods or services using an international credit card, according to the circular issued by the foreign currency policy department of Bangladesh Bank.After submitting the form, the respective banks will scrutinise the form and activate the credit card if no irregularity is found. The international credit card will be deactivated automatically once the transaction is complete.
Bankers and international credit card users, however, termed the new rule as ‘impractical’ as this will make an international online purchase a costlier and time-consuming option.
BB officials said that they are working on the issue and hope the issue will be resolved by the next week.
“The decision is not practical at all,” Mutual Trust Bank Managing Director Anis A Khan told journalists.
Bangladesh Consultant is a local firm that provides domain and hosting services and developing websites for its customers.
“We have to buy website themes regularly for the domain and hosting services using an international credit card,” said Baki Billah, director of Bangladesh Consultant.“We have stopped providing the service to our customers due to the new rule. It is practically impossible to fill-up the form and submit it to the bank for each transaction.”
“The new restriction imposed by the central bank is hampering our business,” said Mushfiqur Rahman, Managing Partner of Spectrum Software and Consulting Ltd.
“We need to buy toolkit worth $500 to $1000 frequently for the software we use. Sometimes we buy them thrice a day.” The government has permitted members of Bangladesh Association of Software and Information Services (BASIS) to spend up to $30,000 per year through international transactions. “But this decision will deeply affect ICT business,” said Mushfiqur, vice president of BASIS.
The banks could not prepare for the new system as there was no advance notice from the central bank regarding the new rule.
“We’ve stopped transactions from the day we received the circular. The customers have to fill the form prior to each transaction. We couldn’t upload the form to our website as yet,” said Dhaka Bank Managing Director Syed Mahbubur Rahman.
“Our customers are facing a lot of difficulties and there is a lot of frustration,” he said, adding that the stringent measure could boost money laundering.
The new rule will reduce the misuse of credit cards as customers now have to apply for approval before making a foreign transaction, said Bank Asia’s Managing Director Arfan Ali.
“But clients will face delays in receiving the service. The application process could prevent them from meeting their immediate needs.”
The central bank has called bank executives and BASIS representatives in for a meeting on Monday to iron out the issues relating to the rule, said Bangladesh Bank’s Deputy Director Nasim Uddin.
“We came to know that people were buying cryptocurrency using international credit cards. Also, the cards were used for illegal acts like gambling and buying lottery tickets. We took the measure to prevent this misuse,” he said.